How Long Does It Take to Get a Mortgage Approval?

Securing a mortgage is a pivotal step in the journey to homeownership. In Canada, the timeline for mortgage approval can vary depending on several factors, including individual circumstances and the efficiency of your lender. Understanding the process and its influencing factors can help you navigate the journey more effectively. Here’s an overview of what to expect when seeking mortgage approval in Canada, and an overview of the key mortgage approval requirements.

What is the Timeline for Mortgage Approval?

The timeline for mortgage approval in Canada can range from a few days to several weeks. While the process itself can be unpredictable, you do have some control over the timing. Oftentimes, the process can be expedited or prolonged based on certain factors including market fluctuations, choice of lender, pre-approval, and more.

To begin the application process, you may want to consider getting pre-approved. Many prospective homebuyers opt to get pre-approved for a mortgage to provide an estimate of how much they can borrow. Pre-approval can often be obtained within one to three business days, depending on your lender's responsiveness.

Regardless of whether or not you decide to get pre-approved, the next step is to search the real estate market in your desired neighbourhood, and determine which home you want to buy. Once you've found a property and made an offer, the formal mortgage approval process begins.

This involves submitting a complete mortgage application along with necessary documentation, such as proof of income, employment verification, credit history, and details about the property. The lender then assesses your application, conducts a thorough review of your financial situation, and determines whether to approve the mortgage.For more information on exactly what your lender may look for, check out our guide for first-time homebuyers.

As part of the regular application process, your lender will likely aim to provide a decision within one to four weeks after receiving your application. However, this timeframe can vary based on factors such as the complexity of the application, the lender's workload, and external factors like market conditions or regulatory changes.

After approval, finalizing the mortgage documents and completing the funding process may take an additional few days to a couple of weeks. This step involves transferring funds and tying up any loose ends in terms of paperwork.

Overall, the entire mortgage application process, from initial application to the closing of the mortgage, generally takes one to two months to complete.

Explore further

6 Month Mortgage Deferral: Here’s what you should know Emergency Mortgage Can My Mortgage Renewal Be Denied? A Surprising Reality for Canadian Homeowners What Is Mortgage Eligibility?

Factors Influencing Your Approval & Timeline

There are many factors that can influence your mortgage approval odds and timeline. While some of these may be out of your control, luckily there are a few levers you can pull to increase your odds. Here are some of the most important factors to consider:

• Financial Health: Lenders assess your financial health, including your income, employment stability, debt-to-income ratio, and credit history. The stronger your financial profile, the quicker and smoother the approval process is likely to be. If you are interested in knowing more about your financial standing, consider testing out a mortgage approval calculator.
• Property Evaluation: At one point in the mortgage approval process, your lender will conduct an appraisal of your property to ensure its value aligns with the loan amount. Delays can occur if there are discrepancies or issues with the property appraisal.
• Documentation Accuracy: Providing accurate and complete documentation is crucial to the timeliness of your application’s processing. Any discrepancies or missing information can lead to delays as your lender may need to request additional documentation or clarification.
• Lender’s Workload: The volume of applications the lender is processing at any given time can affect the turnaround time for approval. During peak periods, such as the spring homebuying season, processing times may be longer.
• External Factors: Economic conditions, regulatory changes, or unexpected events (like the COVID-19 pandemic) can impact the mortgage approval process and timeline.

Tips for Expediting Your Mortgage Approval Process

As mentioned in the previous section, your personal timeline for mortgage approval may vary and will be influenced by various factors. Despite the uncertainty of the process, there are some steps you can take to expedite your results:

• Organize Your Financial Documents: Gather all necessary documentation, such as pay stubs, tax returns, bank statements, and employment verification, before applying for a mortgage. Having everything ready can streamline the application process.
• Maintain Good Credit: Maintaining a healthy credit score by paying bills on time, minimizing debt, and avoiding new credit inquiries can be of great help before applying for a mortgage. A good credit score will enhance your chances of approval and may expedite your overall application process.
• Respond Promptly to Requests: If your lender requests additional documentation or information, you may want to respond promptly to avoid delays in the approval process.
• Consider Pre-Approval : Getting pre-approved for a mortgage before house hunting can give you a competitive edge and shorten the overall timeline by streamlining the formal approval process. With Clover Mortgage, you can get pre-approved for a mortgage under the guidance and support of our expert team, and lock in your terms and rate for up to 120 days while you go house hunting.
• Work with a Clover Mortgage Broker: Our expert team of brokers have experience working with over 60 different lenders and 100 different mortgage products. We can simplify the application process by matching you with the best lenders for your unique needs, and guiding you through the application process.

All in all, the timeline for mortgage approval in Canada can vary based on both individual circumstances and external factors. By understanding the process, addressing key factors that influence approval, and implementing strategies to expedite the process, you too can navigate the journey to homeownership more efficiently. Furthermore, working closely with lenders and Clover Mortgage brokers can help you remain proactive throughout the process, minimize delays, and ensure a smoother mortgage approval experience. Contact us to get started today!

FAQ

How long does it take for a mortgage to be fully approved?

The timeline for a mortgage to be fully approved in Canada can vary depending on several factors, including the lender's efficiency, the complexity of the application, and individual circumstances. Typically, however, the entire process of obtaining a mortgage, from initial approval to closing the transaction, typically takes four to eight weeks. The steps involved in the process most often include: pre-approval, formal application, property appraisal, document finalization, and closing. Working closely with your lender and being proactive throughout the process can help expedite the approval timeline and ensure a smoother homebuying experience.

How long does it take to get pre-approval for a mortgage?

Getting pre-approval for a mortgage in Canada typically takes one to three business days. During this time, you'll submit an application to a lender or mortgage broker, undergo a credit check, and await a decision. Once approved, you'll receive a pre-approval letter indicating the maximum mortgage amount you qualify for. This letter is valid for a set period, usually 60 to 120 days, allowing you to shop for a home confidently within your budget. Pre-approval is a crucial step in the homebuying process, offering clarity on your purchasing power and demonstrating your commitment to sellers.

How can I get my mortgage approved faster?

If you are looking to speed up the approval timeline of your mortgage, here are a few steps you can take:

• Organize Your Financial Documents: Gather all necessary documentation, such as pay stubs, tax returns, bank statements, and employment verification, before applying for a mortgage. Having everything ready can streamline the application process.
• Maintain Good Credit: Maintain a healthy credit score by paying bills on time, minimizing debt, and avoiding new credit inquiries before applying for a mortgage. A good credit score enhances your chances of approval and may expedite the process.
• Work with a Mortgage Broker: Mortgage brokers can help simplify the process by matching you with suitable lenders and guiding you through the application process. They often have relationships with multiple lenders, potentially expediting the approval process.
• Respond Promptly to Requests: If the lender requests additional documentation or information, respond promptly to avoid delays in the approval process.
• Consider Pre-Approval : Getting pre-approved for a mortgage in Canada before house hunting can give you a competitive edge and shorten the overall timeline by streamlining the formal approval process.
• Choose a Reputable Lender: Research and select a reputable lender known for their efficiency and reliability in processing mortgage applications.
• Be Realistic with Your Budget: Applying for a mortgage within your means can increase the likelihood of approval and expedite the process, as lenders typically assess your ability to repay the loan.